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Greg Johnson

How close are growers to the breaking point over labor problems?

Produce grower-shippers have a hard time convincing members of Congress that their labor situation is critical.

After all, there don’t seem to be any fruit and vegetable shortages, do there?

This mindset basically calls grower-shippers’ bluff, and it makes shortages a very real possibility in the future, which would affect retail volume and pricing.

At the recent Washington Conference, hosted by the United Fresh Produce Association, agriculture workforce was a key issue as produce industry members met with their representatives in the House and Senate.

The produce industry wants access to a legal workforce, whether it’s allowing illegal immigrant labor to stay, broadening a guest worker program or other solutions.

But there are many members of Congress, and also President Trump, who have campaigned on and won based on decreasing immigration – legal and/or illegal – and not allowing amnesty for lawbreakers.

Meanwhile, without access to enough workers for the amount of work in the U.S., growers may have to choose to simply plant fewer acres or move operations to Latin America, where growing conditions are still good but the labor issue is significantly better.

American voters simply don’t see the consequences of labor problems in the quality and quantity of fruits and vegetables in the produce department.

If growers get to a breaking point, they may produce less and hope to make up the difference with higher prices, which would threaten retail sales and hurt consumption.

A recent U.S. Department of Agriculture food prices report forecasts 2-3% higher retail prices for fruit next year and flat to 1% higher for vegetables.

But the report predicts farm-level grower prices for fruit will drop 6.5-7.5% in 2018, and vegetable prices will drop 7-8%, based on a stronger U.S. dollar, low fuel prices and other input costs, outside of labor.

Growers are getting squeezed and talk about a breaking point, but it doesn’t seem like anyone will notice unless they break.